Chisholm and Harper | Creating businesses of the future

In the last month a furore has erupted over Railcorp’s handling of four Sydney software developers. The developers created applications that allow Sydney commuters to check train times on their iPhones and mobiles. Now, if you’ve ever experienced Sydney’s mass transit system at peak hour you’ll appreciate how very valuable Sydney’s frustrated commuters found these services.

So, what did Railcorp, operator of Sydney’s rail network, do in the face of such customer-focused innovation? Did they embrace the good work of these clever developers? Did they invite them in for a chat about how they could work together to provide better services for commuters? Hell no! They threw the book at them.

What on earth were they thinking? For what it’s worth, their argument was that the applications may provide out-of-date information because they use timetables sourced from the CityRail website. If CityRail updates those timetables, the application developer must send out a new version of the software for it to remain up-to-date. However, RailCorp has no plans to launch its own equivalent service in the near future, so maybe commuters would prefer to take their chances with out-of-date timetables than no mobile timetables at all.

Let’s have a think about how RailCorp could have handled this situation a bit better. Rather than acting like a bully, what might have happened if RailCorp had opened up its data? Worked publicly with application designers to tap into a network of commuters who would clearly love to receive timetable information on their mobile phones? By allowing its customers to work with them to improve services, they may have been able to deliver them something of value themselves in a very short timeframe. In the meantime, punters might cut them a little more slack and a pressure-sensitive government would get off their back.

Railcorp aren’t alone in their unwillingness to open up their data. Organisations have a tendency to guard their data and intellectual protocol like a mother crocodile guards its young. However, acting in this traditional, closed manner is rapidly becoming incompatible with the needs of modern consumers.

So why do organisations insist on remaining closed?

Firstly, to be fair, there may be real organisational constraints to opening up data.

Many organisations operate on ancient, legacy IT systems that simply don’t allow for easy access to data and information.  So even with the best will in the world it may not be easy for some organisations to open up their data.

Other organisations may have issues with the format of their data. For example, many libraries are transitioning their traditional catalogue formatting into a format that allows Google to find archive materials on the web. What this means is a book about Ned Kelly will be traditionally catalogued as ‘Kelly, Ned’ which means it’s not on the first results page when Google trawls the archives looking for Ned Kelly. Until libraries tackle this data formatting issue it’s going to be very difficult for them to open their data in a meaningful way.   

Accuracy of data may also be a reason why organisations refuse to open it up, but this isn’t really a viable excuse. If your data is not accurate enough to open up, you’ve got some serious thinking to do about how well you are managing a business with inaccurate data.

The main driving force behind why organisations don’t open up their data is good, old-fashioned fear.

But what are organisations scared of? Well it appears they are scared of quite a number of things.

• “We don’t want to lose control of our brand” is one cry I hear a lot. Now, I don’t want to be harsh but if you still think you control your brand then you need to open your eyes, not just your data. The internet has swiped control fresh out of our hands enabled it to be distributed, mutated, re-architected by anyone who wants to. This is going to happen anyway. So, by opening up your data you have an opportunity to extend your brand using the power of the people that matter to it most; your consumers. Give up control and see what happens, I think you’ll be pleased with the results.
• “Our data may be misused or misrepresented” is also a popular argument for not opening up data. However, one of the general rules of the internet is that consumers will self-police themselves. If the Sydney developers who created the timetable apps developed a product that misrepresented timetable data they would soon be chased out of town by the online community. Trust in the power of the internet population to police the use of your data...it works with Wikipedia and open source.
• “It’s too much of a security risk” is an argument that I am loathe to even address because I can’t believe it still exists. As far as I’m concerned this argument is officially redundant. Security risks are security risks whether you are operating online, in person, over the telephone and essentially most of what we do every day is transfer information and data between ourselves using one medium or another. There is no reason why making data and IP accessible online is any more of a risk than making a work-related mobile phone call on the train on the way home.
• “People will steal our IP”. To this I say, let them. In fact, encourage them to. It’s much better to be seen as the originator of an idea than a last-minute adopter. What is more, people will extend your ideas for little or no cost which in turn allows you to innovate quicker. Surely that’s a good thing, right?
• “Our competitors may use it to get ahead of us” is that final argument organisations give for not opening their data.  I would argue in return, that if you are any good at what you do then you’ve got nothing to hide.  If your competitors do use your data to get ahead of you then you can use this as a tool to improve your own service offerings

Openness is good

There has been a fundamental shift in how the world works and it’s not going to change back. Consumers expect a greater level of transparency and openness from the organisations they deal with.  Those organisations that have the vision and bravery (yes, I know it’s scary) to move to a more open, collaborative model of interaction with consumers will very quickly reap the benefits.

Consumers also expect innovative, consumer-focussed products and services, delivered at a constantly accelerating speed. If you don’t get to market first with the products and services your customers want, someone else will very quickly step in and do it for you. If this happens, all is not lost. You have an opportunity to tap into this innovation and harness it for the great good of your organisation and your customers. Moreover, if you try to squash it (like our friends at RailCorp) you will probably experience a very negative backlash.

Transparency is good; you look more trustworthy and consumers will like you more. Let’s face, all any of us really want is to be liked by our consumers.